Tax on Bill Gates at issue
Sharron Angle’s position in favor of repealing the federal estate tax is getting some support from Thomas Jefferson. Or so her supporters argue.
Las Vegas Review-Journal editor and Angle supporter Tom Mitchell invoked Jefferson in a column that referenced “the Lockean principles of life, liberty and property—a concept borrowed by Thomas Jefferson for the Declaration of Independence. In fact, Jefferson signed the repeal of the nation’s first estate tax.”
This tale has been bouncing around the internet, but Jefferson scholars contacted by the N&R say it’s a myth. Jefferson did sign the first estate tax repeal, they say, but not because he opposed estate taxes. Rather, he was keeping faith with the congressional intent that the particular estate tax involved be repealed after its limited purpose—construction of a navy—was completed.
In fact, Jefferson—like many founders—was opposed to unearned inheritance, believing that each generation should start out fresh, without being burdened by artificial structures—“the earth belongs in usufruct to the living,” he said. Usufruct is the right to use or benefit from property. In this field, Jefferson drew not from Locke but from Adam Smith.
“This is nonsense,” said historian Peter Onuf, author of The Mind of Jefferson, after reading Mitchell’s column. “I can’t imagine what the reference might be—perhaps to his authorship of Virginia legislation abolishing primogeniture and entail? He was opposed to the perpetuation of aristocratic ‘estates’—just the opposite of the position implied here.” Entail is a specified line of heirs.
“Jefferson’s most trenchant action on the question of transmission of wealth to later generations was his determined and successful effort to do away with entail in Virginia to prevent the accumulation of great wealth and property in families,” said Annette Gordon-Reed, a law professor and Pulitzer winner for a book on Jefferson.
Columnist Mitchell offered a quote from Jefferson that sounds like the founder opposed estate taxes: “The laws of civil society, indeed, for the encouragement of industry, give the property of the parent to his family on his death, and in most civilized countries permit him even to give it, by testament, to whom he pleases.”
But it turns out that quotation was extracted from a Sept. 24, 1823, Jefferson letter to Thomas Earle in which Jefferson stated that principle only in order to argue against it: “But this does not lessen the right of that majority to repeal whenever a change of circumstances or of will calls for it. Habit alone confounds what is civil practice with natural right.” Mitchell’s sentence is the only pro-inheritance sentence in the letter.
The estate tax applies to less than 1 percent of U.S. estates, and when the tax is in effect (it’s currently not), it collects an average of 20 percent of that one percent of estates.